Tax scams are the most common scams reported to the Better Business Bureau, accounting for one in every four reports to BBB’s Scam Tracker. Fortunately, most people reporting the scams are doing so to warn others. But once in a while, a victim loses money.
One woman said she got a call from an “IRS officer” who said there was fraud in her name from 2007 to 2013. She was told she was potentially facing many years of jail time unless she paid up. The scare tactics worked. The woman handed over more than $7,000.
“I thought I was really being investigated,” the woman wrote. “The two people I was on the phone with gave names and badge numbers. I was very upset and scared of being thrown in jail. I have a job and a son to care for.”
With tax season underway and Tax Identity Theft Awareness Week kicking off Tuesday, the Better Business Bureau serving the Northwest is reminding people to be vigilant with their personal information. The IRS will never call you out of the blue and demand money. But even if you know that, there are still ways scammers use tax season to con victims. Follow these tips:
Watch for Tax Relief Scams. Deceptive advertisements claim to greatly reduce a person’s tax liability. Scammers will create fake but official-looking IRS notices or websites to sway people into paying unnecessary money or divulging private and personal information.
Delete phishing emails. Bad guys will send phony emails that appear to be from the makers of personal tax or other financial software asking victims to “confirm” information or reset passwords. Never click links or download attachments from unexpected emails. If you think there may be a problem, go directly to the company.
Beware of identity theft. Scammers use stolen personal information, Social Security numbers and falsified W-2 information to file fraudulent tax returns in a victim’s name. In some cases, thieves steal W-2s from unsecured mailboxes. If you mail your tax documents, take them to the post office or a secure mailbox.
Work with trusted tax preparers. If you work with a tax professional, take the time to check him or her out. Verify that the preparer has the certifications needed. Ask questions. Be wary of any tax-preparation service that promises larger refunds than the competition. Avoid tax preparers who base their fees on a percentage of the refund.
E-File safely. If you do your taxes online, do so from a secure computer.
Make sure anti-virus software is up-to-date and never use public Wi-Fi to file tax returns.
Protect your identity year-round. Check your credit report three times a year at www.annualcreditreport.com to make sure no unauthorized accounts have been opened in your name. You can report a scam to the Treasury Inspector General for Tax Administration or the Federal Trade Commission.